The Accused

When a Chinatown bank was investigated for fraud, a community’s financial way of life was put on trial.

One afternoon in the fall of 2009, Jie Chen and Ariel Chi walked into the headquarters of Abacus Federal Savings Bank, near Canal Street, to inquire about a mortgage. Chi, who was twenty-four and worked in customer service at a pharmaceutical company, had spent nearly her entire life in the United States, after her family came from Taiwan. Chen, her husband, who was a year younger, had arrived in his late teens and spoke little English. They had been married for a year and spent almost all their time in New York’s various Chinese enclaves, especially Bensonhurst, Brooklyn, where Chen worked at a hair salon. They’d been living in Chen’s studio apartment, not far away, but Chi was now pregnant with their first child and they needed a bigger place.

The plan was to buy a two-family house and rent out one of the units. Looking around the neighborhood, they found one with a small garden out front. The asking price was seven hundred and eighteen thousand dollars, and they began putting together a down payment with money from savings and relatives. The difficulty was getting a loan. The subprime-mortgage crisis of 2008 had exposed lax lending standards throughout the banking industry and credit was tight. Chen had no credit history and was paid largely in cash. “We were asking everywhere,” he told me in Mandarin when I visited him recently at the salon. Many people he knew in Chinatown had similar problems. His co-workers at the salon suggested a solution. “People said go to Abacus. Go to Abacus,” he recalled. A hair washer told him, “It approves loans without too much fuss.”

Abacus was founded thirty years ago by Thomas Sung, a lawyer and a real-estate investor who had come from China in his teens. It is one of a dozen or so community banks in Chinatown that cater to immigrants, including undocumented ones, who often inhabit a cash economy and mistrust mainstream banks. For more than two decades, Abacus had grown at a healthy rate; the year that Chi and Chen applied for their loan, it had six branches and some hundred and fifty employees, and originated about half a billion dollars in loans.

At the Abacus headquarters, Chen and Chi went to the loan office, on the third floor, and were greeted by a stocky, talkative man named Ken Yu. Chen felt an immediate rapport. Yu was only a few years older, and, it turned out, was from Chen’s home town, the coastal city of Wenzhou. He said that getting a loan would be easy if they just left everything to him. They agreed on terms, and in the weeks that followed the bank obtained employment documents while the couple wrote checks and submitted letters accounting for money family members had given them. Chen’s parents wired funds from China, which they had borrowed using their home as collateral. Chen had already begun mapping out in his head which half of the house the family would live in, which half they’d rent out, where they’d put the nursery.

The closing meeting for the house took place on the morning of December 11th. Chen and Chi left their infant son with Chi’s parents before heading over to Abacus. There they met their lawyer; the seller of the house and his lawyer; and Vera Sung, a daughter of Abacus’s founder and an attorney who represents the bank during closings. Chen found the meeting, which was conducted in English, hard to follow. Still, he said, “I didn’t care so long as I got my house.” But as one of the last papers was being signed Chen remembered something: his wife had written Ken Yu two checks totalling twenty-five hundred dollars, and he wanted to make sure that this money had been credited along with his other payments. When the couple’s lawyer asked about the checks, however, everyone reacted in confusion and Vera demanded to see Ken Yu. “I had no idea what was going on,” Chen said. “Nobody explained anything to me.” After Vera and her sister Jill, the bank’s president, questioned Yu and found his answers suspicious, they called off the close. (It later emerged that Ken Yu had not only taken money from the couple but had also misrepresented income details in the mortgage application.) “It was like the sky had fallen and my world collapsed,” Chen told me. He knew that the seller would likely get to keep the ten-per-cent deposit the couple had already paid. The money—seventy-two thousand dollars—was more than two years’ salary. “It’s the blood-and-sweat money that I earned,” he said. A month after the meeting, the couple walked into the N.Y.P.D.’s Fifth Precinct, a few minutes from the bank. They told the police that an employee of Abacus Bank had stolen money from them.

By then, the Sung sisters had fired Ken Yu and two other employees and the bank had begun an internal investigation. It reported the findings to regulators and law enforcement and later hired outside investigators to examine the loan department. But Chen and Chi’s visit to the police had also triggered a criminal probe. On May 31, 2012, Cyrus R. Vance, Jr., the Manhattan District Attorney, announced a hundred-and-eighty-four-count indictment against the bank, two of its supervisors, and nine of its former employees. The charges included residential-mortgage fraud, falsification of business records, and conspiracy. Abacus employees were marched through the Manhattan Criminal Courthouse, handcuffed together. Some faced a maximum sentence of twenty-five years in prison.

Ten Abacus employees accepted plea deals in exchange for testifying against the bank, and Ken Yu became the star witness. The indictment alleged that, in order to approve mortgages for unqualified borrowers, the bank had systematically falsified loan-application documents, “inflating or exaggerating their assets, incomes, and job titles.” This resulted in “fraudulent mortgages” being sold to Fannie Mae, the federally backed mortgage company. Fannie Mae’s purchase of risky mortgages was a widespread problem during the subprime lending crisis, something that Vance emphasized in a press conference announcing the indictment. “If we’ve learned anything from the recent mortgage crisis, it’s that at some point, these schemes unravel and taxpayers can be left holding the bag,” he said.

But in some ways Abacus was a surprising target for a high-profile mortgage-fraud case. Of the four thousand three hundred and ninety mortgages that Abacus held in 2009, only sixteen were in trouble, a delinquency rate less than a twentieth of the national average. Chinese immigrants, poor though some of them were, seemed to be far more dependable as borrowers than the rest of America. Of all the institutions that were investigated for mortgage fraud after the financial crisis, the only commercial bank that was brought to trial was a small community bank whose assets had never exceeded two hundred and eighty-two million dollars—around a hundredth of one per cent of the assets of Bank of America.

The office of Thomas Sung, the founder of Abacus, is three floors above where the tellers sit at the bank’s headquarters. It is a ramshackle room, determinedly functional and frugally furnished. When I first visited, in February, boxes of files formed a mountain on the floor, law journals were piled on cheap shelving, and a straggly potted palm wilted in a corner. The only color was from the tea sets, a traditional Chinese ceremonial gift, that had been left lying around. To Sung’s customers, the décor would be reassuring; it is the office of someone who knows that money is too important to be spent casually.

Sung is eighty and splits his time between Florida and Connecticut. But when he’s in Connecticut he still comes into the office every day. Avuncular in manner, he is nonetheless steely and disciplined. He stays quiet as his family members chatter. When he speaks, everyone falls silent.

Moving a heap of financial manuals aside, Sung produced a copy of his father’s application for a Treaty Trader visa to the United States, where the family arrived in 1951, having left their home, in Chongqing, Sichuan, a couple of years earlier. The application, hundreds of pages long, included an extensive history of a brush-bristle manufacturer, the New China Bristles Company, which Sung’s father owned. Tucked into the pages were black-and-white photographs of workers, managers, and apprentices in dark cheongsam robes. Sung told me that the firm supported an orphanage, whose charges often grew up to become employees in the factory.

Sung pointed to a picture that showed a big-eared, sombre boy of sixteen wearing a checkered tie. “That’s what I looked like entering Ellis Island,” he said. Sung’s family was wealthier than most immigrants to America, but his mother died soon after their arrival and he was expected to look after the family instead of building a career. His father refused to pay for legal studies, so Sung put himself through Brooklyn Law School and developed austere habits. In the early nineteen-sixties, he met his wife, Hwei Lin; they settled in Chinatown, and Vera, their eldest child, was born in 1966.

By then, Sung was a man on the rise. He worked for a largely Jewish law firm that had handled his family’s immigration application—“They liked to call me Shapiro!” he said—but soon opened an office of his own. In the sixties, there weren’t many Chinese lawyers, and almost no one who understood the intricate and informal ways of Chinatown. Sung was fluent in English, Mandarin, Cantonese, and Sichuanese, which enabled him to slip between different worlds. Working from a storefront on Pell Street, where he had to jump over garbage pails to reach the front door, he quickly found an untapped market. “I was one of the biggest immigration lawyers in New York back in the day,” he recalled with pride. As his law practice grew, Sung began buying real estate. Once, as I walked down Market Street with him, he said, “I used to own this entire block.” “Everyone knew Thomas Sung,” Kenny Chan, a veteran Chinatown publisher, told me.

The Sungs had four daughters, and in 1972 they moved to Greenwich, Connecticut. Vera was the first Asian child to attend Glenville Elementary School. The sisters took swimming lessons at the Y and played tennis at a local sports club. Chanterelle, the youngest of the four, competed in what she jokingly calls “rich-white-people sports.” Today, none of the sisters know how to spell their name in Chinese, and it wasn’t until we had met a few times that they learned to pronounce my name without mishap. Vera told me, “I felt like I never fit in in Chinatown, because my parents only wanted us to learn English.” Jill, the second oldest, said, “I call us the lost generation, because our parents, being immigrants, just wanted us to assimilate.”

In 1984, Sung founded Abacus. He told me that difficulties getting funding for one of his real-estate developments alerted him to the need for a bank serving the Chinese community. Abacus’s beginnings were modest—the original premises, which are now a T-Mobile store, were robbed twice in the first year—but it was a good time to start a bank. Few banks in the neighborhood even hired Chinese-speaking employees, and fewer still made an attempt to understand the financial world of immigrants, who were often paid in cash, sent much of their income home in remittances, and liked to stash valuables in safe-deposit boxes. Abacus’s employees tended to be Chinatown residents who saw job listings in the Chinese-language papers, and who, like the customers they served, were often immigrants or the children of immigrants. The bank grew fast, especially as trade between the U.S. and China increased throughout the nineties. It began offering wire transfers, and in the weeks leading up to the Chinese New Year would process several hundred such transactions a day. Sung developed the use of nontraditional borrower profiles—a way of examining routine household payments to assess creditworthiness among people who don’t have a typical credit history. Abacus opened branches in Chinese enclaves across the city, in New Jersey, and in Pennsylvania, and it expanded into insurance and securities.

From the start, Thomas Sung groomed his daughters to enter the family business. Vera recalls being taken to real-estate closings as a teen-ager, and three of Sung’s four daughters attended law school. (The fourth went to medical school.) Vera and Chanterelle worked for the District Attorney’s office, in Brooklyn and Manhattan, respectively. Vera recalled, “Our father said we should become prosecutors because that’s the best way to gain experience and rise on the ladder.” In 2005, Jill, who was then thirty-seven, and had received an M.B.A. from Wharton, succeeded her father as C.E.O. and president. Vera, though not an employee of the bank, is on the board of directors and runs the family law firm, Sung & Co.

Jill told me that she’d long known she would come to work for the bank one day. When I asked her if she ever felt tempted by more mainstream prospects, given her education, she spoke of the importance of giving back to the community that had provided the foundation for her family’s success. “It’s a luxury to go to college and law school without having to worry about loans, because your parents are able to pay for it,” she said. But she was candid about the challenges that running a Chinatown bank presented for someone who had grown up outside the community. “I remain very self-conscious,” she told me one afternoon, as we sat in her office, which is as neat as her father’s is messy, and contains no Chinese decoration at all. “My father started a community bank because he is fluent in multiple dialects and worlds,” she said. “But, as the president of that community bank, I can’t visit its customers without someone to help me translate.”

Yet even Thomas Sung’s cultural fluency couldn’t protect against all eventualities. In 2003, a Chinese-language newspaper reported that a branch manager on Canal Street named Carol Lim had made off with ten million dollars. Thousands of panicked customers lined up outside the bank’s various locations, desperate to retrieve their cash. The bank came within an hour of a takeover by the F.D.I.C. “I was outside with a police bullhorn trying to calm the people,” Thomas Sung told me. “There were rumors that I had fled with Carol Lim to China!” Lim, who was never found, had been with the company for fifteen years. “She spoke multiple Chinese dialects and was fluent in English,” Sung said. “And I needed someone to run a branch.” I asked him what he took away from the episode. He blinked and responded, “You want to believe the best in people, but sometimes it’s hard to do that, maybe except for your family.”

The family saw similarities between Lim and Ken Yu. Vera said, “There’s a Carol Lim in every generation.” Like Lim, Yu was extremely capable. After coming to America, at sixteen, Yu worked in a sweatshop in Queens—to pay off the snakehead who had smuggled his parents into the country—but still did well enough in school to go to Pace University, where he majored in business. He began working at Abacus in 2005 and rose rapidly. By 2009, his salary, based largely on commissions, had increased eightfold, to two hundred and twenty-three thousand dollars a year. Fluent in English, Mandarin, Cantonese, and the dialect of Wenzhou, he was one of the few employees who could converse with the entire staff and with virtually any customer. “He’s a learner and a striver,” Vera told me. Her father nodded, and said, “I would have thought of him as someone with a future, someone with management potential.”

Immigrants have always formed enclaves in their adoptive countries, but American Chinatowns are particularly large and inward-looking, in part because of the strained circumstances in which the Chinese came to America. In the nineteenth century, as the gold rush in America and the Opium Wars in China spurred mass migration, the United States passed the Chinese Exclusion Act of 1882. The act, which wasn’t repealed until 1943, remains the only federal law ever to exclude a group of people by nationality. It instituted a variety of measures designed to deter Chinese workers from entering the mainstream labor market. Driven out of mines, mills, and factories, they clustered in urban ghettos. Generations of Chinese could not assimilate and planned to stay only as long as it took to save enough to retire back in China.

This sojourner mentality gave way to a settler ethos only after the Immigration and Nationality Act of 1965. “The Immigration Act allowed family union,” Peter Kwong, a professor of Asian-American Studies at Hunter College, told me. “It encouraged migration as a family unit.” From 1960 to 1985, America’s Chinese population more than quadrupled, and immigrants began to aspire to own property here. The Chinese have one of the highest rates of home ownership in the world: eighty per cent of households in China own their home; in the United States, the percentage is sixty-five. Culturally, the Chinese invest home ownership with all their hopes of success and stability. Min Zhou, a professor of sociology and Asian-American Studies at U.C.L.A., told me, “For many Chinese, it’s a precondition of starting a family, and also an investment in the future.”

But, for recent immigrants to the U.S., buying a home presents challenges. “Most residents who don’t leave Chinatown and don’t speak English are intimidated by the idea of going to a mainstream bank,” Zhou said. “It’s like going to a foreign country all over again.” The fact that such people often work exclusively in a cash economy means that their income is hard to prove. “They are busboys, seamstresses, nail-salon employees,” Zhou said. “They are paid in bills at the end of every day or week. It’s only when they go get a mortgage or loan that it gets to be a problem.”

The difficulty immigrants face getting bank credit means that more traditional ways of raising money remain prevalent. At the simplest level, extended-family networks are tapped for cash that has a status somewhere between that of a gift and a loan. “The money is a type of relationship insurance—it’s a way of binding the family together,” Zhou explained. Whether the numerical amount is paid back is less crucial than what it signifies. “It’s that you will come to my aid, in whatever form I need, when I have difficulty. I saved up a hundred thousand dollars for my son’s down payment. If he can pay me back someday, great. If not, I don’t expect the money back. He’s family, and my grandchildren might grow up in that house.”

Another important means of raising capital is a hui (which means “association” in Chinese). A method of pooling money, the hui involves a consortium of acquaintances who contribute to the pool. The details of the practice vary, but often whoever agrees to pay the highest rate of interest wins the pot. Money pools are clannish, with members of a given hui typically coming from the same region of China or even from the same village. “If you don’t pay back the money you owe, not only you but your entire family, both here and in China, may be at risk,” Zhou said. “You hear a lot about Chinatown youth gangs hired by associations to enforce loans.” In 2012, a thirty-six-year-old woman was murdered in her apartment on Henry Street for allegedly attempting to flee with two hundred thousand dollars taken from a hui; the apartment was set on fire in order to conceal the crime. The implicit threat of violence or ostracism is one reason that lending money is seen as safe in the Chinese community. “If you are in Chinatown, and if your options are limited, you cannot afford not to be honest,” Zhou said.

Robert Hockett, a law professor at Cornell who specializes in bank regulation and real-estate finance, told me that he thought the Abacus case illustrated an evolution in lending practices, which he outlined in three stages. In the first phase, there was little need for written contracts because in traditional communities no one would risk breaking his or her word. In the second, when formal contracts started to appear alongside the old understandings, a lender assessed a borrower’s creditworthiness “at least partly on the basis of exposure to the community.” This was essentially the world of Abacus’s customers, and Hockett stressed that, until quite recently, it was the world of mainstream American banking, too. “Mortgage loans were provided mainly by local banks, or savings-and-loan institutions,” he said. “The lender knew who the borrower was and could do a credit check pretty easily.”

He went on, “Finally, the third stage is the stage that really took off, starting in the nineties, and brought us the crisis. This is what’s called the ‘originate to distribute’ model. Here what you get is a bunch of loan originators who don’t know you at all. They’re extending loans to you fully intending to sell the loans to somebody else who knows you even less well—the securitizer. And so now the only thing you have is the paper. The documentation is everything. There is literally no space for trust at all.”

In a sense, Abacus’s customers—with their limited financial horizons and their reliance on networks of trust—were living the thrifty lives that small-town Americans once prided themselves on. Whereas the financial crisis was caused by mainstream American banks making loans that they knew were likely to result in default, the low rate of default at Abacus showed the bank to be uncannily astute in reckoning the financial capacity of its borrowers. As an op-ed in a Chinatown newspaper put it, “If every bank behaved like Abacus, the financial crisis wouldn’t have occurred.”

However, unspoken in many discussions about the Chinatown economy is the issue of tax evasion. The under-reporting of income means that the gap between a prospective home buyer’s official income and his or her actual resources can be enormous. The Abacus borrowers who eventually admitted falsifying loan applications were frequently trying to account for money that they actually did have but had previously failed to report. Instead of inflating incomes, as the D.A. alleged, in many cases Abacus had seemingly managed to accurately assess borrowers’ true incomes, rather than the artificially low numbers they divulged to the I.R.S. According to the indictment for the case, in 2009 Abacus lobbied for an exemption to a proposed Fannie Mae rule that would require borrowers to permit examination of their tax returns. The indictment alleged that Abacus knew the rule would harm its business, and pointed out that when the bank was denied the exemption its loan-origination volume fell by ninety per cent. (Abacus maintains that this drop-off was a result of the investigation, during which it suspended loan activity.)

The trial began this January, at the New York State Supreme Court in Manhattan. By that time, the prosecution had amassed a great deal of circumstantial evidence about activities at the bank: nearly all the employees in the loan department had either been indicted or had pleaded guilty to offenses that included falsifying employment and gift letters and exaggerating the incomes of borrowers. Nonetheless, in the nine hundred thousand documents that were subpoenaed from Abacus, there was no explicit communication from any senior management condoning any of the activities cited in the indictment. In the Sungs’ view, this was a sign of innocence; to the D.A.’s office, it indicated only that the Sungs knew enough not to communicate as incautiously as the more recent immigrants they employed did.

No one disputed that the bank had approved false loan applications. But, whereas Abacus blamed rogue employees, prosecutors insisted that those employees were executing a tacit policy of the bank. At one point, a prosecutor presented a diagram of an open-plan office in the Abacus loan department, showing who sat where and what wrongdoing each employee had admitted. The desks effectively encircled the desk of a supervisor who was now a defendant. How could he not have known what was going on all around him? the prosecutor asked. Furthermore, if he knew, then the bank’s management was legally responsible. “Why do loan officers and processors feel so comfortable making up this information?” she asked the jury. “It’s because that is the Bank’s practice. That is what the Bank does.”

Three weeks into the trial, I saw Ken Yu calmly reading Fortune magazine as he waited to take the witness stand. He was now in his mid-thirties and plump. He wore a dark suit, a baby-blue tie, and, on one finger, an emerald ring. He never made eye contact with the Sungs, even when identifying Jill for the court. Yu was one of the few witnesses who didn’t require a translator, but he spoke English haltingly. His manner was both brazen and evasive, and the five days that he spent on the stand devolved into a wearying cycle of omissions and “I don’t remember”s. Asked during cross-examination whether he was doing something wrong by passing on borrower information that he knew to be false, he glared and replied, “Could be, but not never my responsibility to judge right or wrong.”

The bank’s legal team had decided that the best strategy was to chip away at the credibility of the prosecution’s witnesses rather than to put anyone from the bank on the stand. “It should not be about you,” Jill recalled being advised. “It should be about how bad their witnesses are.” This approach worked well when it came to cross-examining the borrowers. Many of these people—restaurant workers, gift-stand owners, seamstresses—had little formal education or contact with mainstream American society, and some had received pre-dawn knocks on their doors by investigators with unsettlingly comprehensive knowledge of their immigration and employment status. They looked uncomfortable in the courtroom, alternately perplexed, intimidated, and contemptuous of the proceedings.

The bank’s lawyers drew attention to the aspects of their lives that sounded shadiest to outsiders. When one counsel asked a fidgety young cook if he knew the co-owner of the restaurant where he worked and with whom he also happened to live, the man initially claimed that he had “only met this person a few times,” but then conceded, “You can say she’s like a sister.”

The defense also focussed on the prevalence of tax evasion among borrowers. “Year after year you filed false tax returns to avoid paying taxes; isn’t that right?” a lawyer asked one borrower, who replied, “I would say it’s sort of like that. I reported a little less.” As well as casting doubt on the reliability of the witnesses, this line of questioning emphasized that many of Abacus’s borrowers could afford mortgages that were significantly larger than their declared incomes would suggest.

Traditional Chinatown practices such as hui and ambiguous loans or gifts from family members became significant in the trial, because Fannie Mae generally forbids the use of loaned money as a down payment to secure a mortgage. However, once the witnesses were on the stand, the distinction between a gift and a loan broke down. A restaurant worker in his thirties, asked if he had an obligation to pay his brother back, said, “Well, it’s not like I don’t need to pay back; it’s like when I have the ability.” In that case, it wasn’t a legal obligation, the defense counsel said, pushing for clarity. “Well, I think so, because we all a family member, we don’t have any I.O.U. written down,” the man replied.

Frequent translation problems complicated matters even more. In New York courts, budget constraints have limited the hiring of interpreters, which has led to scrutiny from lawyers’ associations. Because transcripts of trials are entirely in English, there is no permanent record of what was said in other languages. At times during the trial, it was unclear how much unintelligibility was caused by mistranslation and how much by the deliberate indirection of witnesses. On one occasion, a prosecutor, trying to get to the bottom of a previous mistranslation, asked a witness, “The interpreter didn’t know what the word ‘everything’ means?” I then heard the interpreter mistranslate this question into Mandarin as “Why didn’t the interpreter interpret everything?” Few people involved in the case were in a position to know that the translation had gone awry, but three reporters who were covering the trial for Chinese-language papers were very familiar with the problem. “This is physically painful to listen to,” a reporter for Sing Tao Daily whispered at one point. When a lawyer asked a witness, “Isn’t it true that you have no problem lying when it’s in your interest to do so?” the interpreter rendered it as “Doesn’t it harm your over-all interests to lie?” The bank’s lawyers did not speak Chinese, and the mistake entered the official court record.

The jury’s deliberations began in late May and went on for nearly two weeks. Both sides seemed pessimistic about the outcome. Eventually, the judge implored the members of the jury to come to a verdict, and on June 3rd and 4th they found Abacus and its co-defendants not guilty on all counts.

In Chinatown, residents and business owners called to congratulate the Sungs. Local newspapers put the news of the bank’s acquittal on their front pages. Criticism of the prosecution was not limited to the Chinese press. The Times called the case “dubious.” Bennett L. Gershman, a former prosecutor at the Manhattan D.A.’s office who is now a professor at Pace Law School, told me, “This case just involved a terrible example of poor judgment by the prosecutor.” He characterized it as a “David and Goliath situation,” echoing a widespread view that it was simply convenient to make an example of a small bank like Abacus.

I visited Cyrus Vance, Jr., in his office, overlooking Hogan Place, and asked if there were lessons to be learned from the outcome of the trial. He maintained that it had been right to investigate the case and bring it to trial. “This was a response to a complaint which required us to look at their files,” he said. “There was a protocol that would have been followed if the bank was Citibank or if the bank was a bank servicing South American immigrants.”

He remained unconvinced by the argument that, since Abacus’s loans performed well, no harm was done. “Just as in the mortgage boom of 2008, everything was fine until it wasn’t,” he said. It was one thing for a bank to follow subjective assessments of borrowers’ creditworthiness, but another to sell the resulting loans to an institution like Fannie Mae. “If I promise I’m selling you a new car, and it looks great but the engine is rebuilt and I don’t tell you, and the engine could fall apart in fifty thousand miles,” he said, “you may love the car and you may be happy, but you don’t know that you’re buying something that actually has the potential not to perform.”

Vance also thought that Abacus had placed its borrowers at risk. “The individuals who were getting the loans got the benefit of the loan but were also at risk in ways that were unfair to them,” he said. “For all the good that Abacus Bank does, I felt that, in this case, there was a failure on the bank’s part, through its employees, to be honest with the borrowers as to the implications that filing false documentation brings.”

I contacted a former employee of Abacus, who spoke on the condition of anonymity. He felt that the case was wrongheaded, but for reasons that were completely different from any I’d heard other people voice. “I thought the D.A.’s office might address the bigger, systemic problem of tax evasion in Chinatown and admonish the population about the importance of following the law,” he said, shaking his head. “But they chose to draw this stupid parallel between Abacus and the financial crisis.”

He was also scornful of Vance’s idea that Abacus had put its borrowers at risk. “Don’t tell me the borrowers are innocent,” he said. “They don’t need protection, because they are the biggest beneficiaries and perpetrators in the entire case. Some of these people earn half a million or more and still get to be on welfare and Medicaid.”

He wasn’t surprised that the prosecution hadn’t managed to prove that Abacus’s officers encouraged the falsification of incomes. “Nobody explicitly tutors you,” he said. “When you are on the inside, you see the way the documents are written. You have to remember that the hires are people from the immigrant community. They know how things work.” He went on, “To be honest, we didn’t think we were really breaking rules so much as circumventing them—you know, in a Chinese way.”

He found it genuinely hard to say whether the Sungs knew what was going on. On the one hand, he thought that everyone in Chinatown knew how things worked. Yet he didn’t really consider the Sung sisters to be Chinese at all, and he didn’t believe anyone at the bank deserved conviction, given that “the borrowers were getting off scot-free.” Extending his arms wide, he said, “This case should have been about this much stuff and the economic realities of a large group of people.” He pulled his hands in so that they were almost touching, and said, “Instead, the government places the blame on a tiny group of people who are not even the root of the problem.”

Not long after the trial, I went back to the hair salon in Bensonhurst to tell Jie Chen about the verdict. He was on his smoke break, looking at Google street-view images of houses on his smartphone. “It’s for a friend who’s looking to buy,” he told me. He hadn’t heard about the verdict and didn’t seem to think that it mattered. “Who cares who wins?” he said. “Lawyers, bankers—they are all certified crooks.” Chen seemed to think that Abacus, far from taking risks to help his countrymen, was part of an American conspiracy to bilk Chinese immigrants of their savings. The only person he still trusted was Ken Yu. I pointed out that Yu had under oath repeatedly confessed to stealing from him and his wife. Chen just shook his head as if I were the one who was confused. “It was all the bank,” he said. Then he smiled. “If I had millions of dollars, I would devise a scheme. I would buy houses and try to sell them to the exact kind of people who I knew couldn’t close due to some bullshit glitch. And then I would take their down payment.”

A few days after the trial ended, Thomas Sung, Vera, Jill, and Chanterelle had lunch at the family’s favorite restaurant, a block from the office. On the walk over, they were continually recognized and congratulated on the outcome of the trial. “I heard the news!” a jowly man in his mid-fifties said, taking Sung’s hand. “We’ve been wanting to get a loan from you!” he continued in Cantonese. Then, seeing Jill, he repeated the sentence, this time in English. Jill explained that the man was the owner of a car-service company and a longtime customer of Abacus. Meanwhile, Thomas Sung had been spotted by another passerby and was engaged in another conversation, in another dialect. Addressing me in Sichuanese—like him, I was born in Chongqing—Sung apologized to me for the delay, and I told him that he seemed to be a celebrity. “Everybody knows me, because I took the tough immigration cases back in the day,” he said. “I always say I take the illegal immigrants, make them legal, bring their family together, help them buy a house, help them start their business. And when they are successful they don’t need me anymore, and then they go to Citibank.”

The restaurant, Hop Lee, which means “communal benefit,” was a no-frills Cantonese place, wedged between a trendy Japanese ramen shop and a dry-goods store. Inside, only a couple of tables were occupied. At one, a large Chinese family tried in vain to quiet a tired baby. Nearby, two older men enjoyed a leisurely meal of noodles and Tsingtao beers. Switching between Mandarin and Cantonese, Thomas Sung exchanged greetings with the waiter and ordered for us, without a menu. Not everything he ordered was palatable to the sisters. They pushed a clay pot of chicken feet, with claws attached, toward their father. “My kids eat the feet,” Jill said. “It’s because they had a Chinese nanny.”

I asked about the challenge of running a bank whose clientele and staff did not seem to understand the regulations. The two generations answered differently. Thomas said that the cultural gap was an advantage for Abacus: “That’s how I knew Chinatown needed a bank back then!” But Jill admitted that there were risks, and that the applicant pool for jobs was uncomfortably shallow: “On the one hand, we want to be giving those in the community a chance to make a life, but on the other we need qualified candidates.” She recalled an incident that occurred after Ken Yu was fired. “We were looking for another Chinese-speaking loan officer,” she said. “An employee at the bank had heard of a really good applicant. I asked what his name was. It was Ken Yu!” The community, in the end, remained an island apart from the city, and options were limited both for the bank and for its customers. Vera said that one of the borrowers who had testified against the bank stopped by soon after giving her testimony to apply for another mortgage.

The waiter came out to clear our plates, smelling faintly of cigarettes. As the young man bent forward, Thomas Sung patted him on the head, and the man smiled. Sung switched to Cantonese, the waiter’s first language. Vera asked her father, “Did he go to the barber you recommended?” Sung didn’t answer. He was absorbed in a conversation that neither his daughters nor I could understand. ♦